HP is taking a more software-centric approach to the enterprise IT business.

HP is backing away from the consumer electronics business.

HP in particular is backing away from the generic desktop/laptop PC business, which may with only moderate exaggeration be regarded as:

The intersection of the enterprise IT and consumer electronics businesses.

The least attractive sector of each.

My coverage of Autonomy isn’t exactly current, but I don’t know of anything that contradicts long-time competitor* Dave Kellogg’s skeptical view of Autonomy. Autonomy is a collection of businesses involved in the management, search, and retrieval of poly-structured data, in some cases with strong market share, but even so not necessarily with the strongest of reputations for technology or technology momentum. Autonomy started from a text search engine and a Bayesian search algorithm on top of that, which did a decent job for many customers. But if there’s been much in the way of impressive enhancement over the past 8-10 years, I’ve missed the news.

*Dave, of course, was CEO of MarkLogic.

Questions obviously arise about how the Autonomy acquisition relates to other HP businesses. My early thoughts include:

HP has clearly signaled that it intends to pursue and focus on the data management business. Thus, we can anticipate marketing messages spanning Autonomy and Vertica. It may be helpful to recall that Vertica plays nicely with both Hadoop and Attensity.

The first two natural tuck-in acquisitions I can think to add are Attensity and MarkLogic.

One place I’d look for synergy is with HP’s system management software business. HP has previously acquired its way into a strong position there. If you add in knowledge of how many kinds of data are used, you have a chance to set yourself apart in the system management area.

I had enough trouble advising Vertica about how to explain what they do in terms that HP’s hardware sales force can comfortably embrace. I think I did OK with that. But Autonomy? Youch. On the other hand, …

… HP is run by guys from SAP (Leo Apotheker) and Oracle (Ray Lane), both of whom have dealt with similarly tough sales challenges before. But even at best, HP’s sales force organization, commission structure, and training is going to consume a lot of attention at the very highest levels of HP.

HP is clearly abandoning WebOS-based devices, and is exploring strategic options for WebOS itself, including near-certain staff cuts at a minimum, if I read the reporting correctly. That counts as “pulling back” in my book.

I agree with you about Autonomy’s technical foundation – and there are other Bayesian search technologies out there, such as the open source Xapian (www.xapian.org), also developed in Cambridge to succeed Muscat, which appeared at almost the same time as Autonomy’s IDOL.

Curt, I don’t see that Attensity offers anything significant technically that Autonomy doesn’t have in spades. Sure, the approaches to text analysis are different, but that difference doesn’t really affect the business-worthiness of either company’s solutions, and I’d be surprised if there’s enough money involved in joint Attensity-Vertica deals to make that alliance a selling point.

Myself, I see HP’s next acquisitions as complementary BI and SOA players. Think TIBCO. I could see them interested in others ranging in size from SAS to Actuate.

I don’t see what Autonomy has as being useful inputs to the rest of the analytic stack. Have I overlooked one or more of its many acquisitions?

Ian Hersey on
August 19th, 2011 6:13 pm

Seth, really? We couldn’t be more different from and better than Autonomy when it comes to analyzing text beyond probabilistic search results ranking and routing. They don’t even make the short list of vendors considered in text analytics or social media monitoring/analysis opportunities, nor do they show up in the government intelligence landscape (where Verity had historically been strong, at least as a search engine).

And who actually OEMs Autonomy’s search anymore? An OEM rep of theirs I talked to recently said his business was mostly the Keyview filters – not exactly an exciting business for someone the size of HP.

From pure money point of view, I don’t see how this would not be mission impossible for HP to pull off. I think what Apotheker and company are saying is that they want to make HP in to an enterprise software company because that is where the margins are best. That sounds great, but Vertica + Autonomy can’t possibly be the base they would buil the business from? At least not large enough a business to compensate for what HP is giving up in the PC space.

HP has an enterprise software business already, so that part is in their favor. It’s not as if Autonomy and Vertica are the only pieces.

However, they’ve made it clear, in statements and with those two acquisitions, that they want to get stronger in data/information management.

Anoop Dwivedi on
August 30th, 2011 10:54 pm

Curt, I think outside of a limited market (EU), we dont really hear much about autonomy. I still believe that Attensity has a better brand name.

Vertica is pretty much a datamart appliance. I seriously doubt that they could scale to EDW.

regarding HP’s current software business, it is primarly in infrastructure management or I should say datacenter management. Leo would have make some expensive acquisitions to get into the Enterprise applications business. I think something like Infor could get them into ERP/CRM/Logistics, but then they would become the competitors to SAP which could be tricky.

You might want to look again at some of my posts on Vertica. I agree that their customers don’t have the craziest of schemas right now, but check out Vertica’s (credible IMO) claims regarding number of petabyte-scale customers or levels of concurrency achieved.